No one likes to be feel as if they’re being discriminated against.
But it happens all the time, depending on your age, your gender, your skin colour, your physical ability, your income…
And it seems it’s also happening when it comes to what we are charged for products and services.
Companies employ all sorts of different tactics to charge us vastly different amounts for the same things: at Which? we call it price discrimination.
While price discrimination has been around for years – from old-fashioned market-stall haggling to current-day discount voucher website offers – and most of us accept it as part of life, there’s surely a limit.
Especially when, with online shopping in particular, it begins to lead to each customer paying a unique price.
Retailers tailoring the price they charge based on what they know about you is the aim of schemes like loyalty cards, but its use in online shopping is becoming slightly insidious.
While buying online can often help us to compare prices and flush out variations, it also gives companies greater access to our data, which could lead some to try to tailor the prices we see.
Retailers can access information about us from Google and Facebook – leading to us being charged “personalised prices”.
It’s possible for retailers to use your IP address (a unique address given to each device that connects to the internet) to change the price you see, based on where you are.
A few years ago academic researchers created two personas on different computers – a wealthy customer and a budget-conscious one.
Using the two profiles to search the internet for goods and services, they found that search results differed.
Basically, the more affluent profile was offered higher prices than the budget-conscious one.
So websites can make predictions about your spending habits using behavioural profiling or data, or even the tech you use to search the web.
You may not be too worried about price discrimination when it’s working in your favour, but that’s unlikely to be the case all the time.
We’ll be keeping an eye out for price discrimination that’s either clandestine or excessive.
Send me your consumer queries at email@example.com
FIGHTING AGAINST DISCRIMINATION
To be considered price discrimination, charges for goods and services must differ for reasons that go beyond the basic costs of production and supply.
Retailers can place shoppers into groups and tailor prices accordingly – for example, by offering student discounts, or lower fees for senior citizens. Customers can also grouped by postcode.
And then there’s increasing prices when demand is high. Airlines, train companies, theatres and cinemas do this, as does car service Uber, which charges its customers higher ‘surge’ prices during busy periods, such as New Year’s Eve.